|By Katherine Long and Kyung M. Song, The Seattle Times|
|McClatchy-Tribune Information Services|
Bahr's parents earned too much for him to qualify for financial aid, but not enough to help pay for college. That forced Bahr to tap out on federal student loans and borrow more from private lenders at higher interest rates.
"I essentially graduated with a mortgage," said Bahr, who works as a surety bond underwriter in the insurance industry.
Bahr's debt is part of
On Wednesday, the
Rates on loans made to parents and to graduate students also would be lowered, to 6.41 percent.
The Bank on Students Emergency Loan Refinancing Act has 43 Democratic co-sponsors — including Sens.
Offering lower rates would cost the federal government an estimated
Many Republicans oppose that tax increase.
The vote comes two days after
The Obama administration in 2012 estimated that borrowers would be allowed to wipe out an average
Murray said Tuesday the weight of student loans is dragging down the economy and leaving young people strapped as consumers.
A growing number of economists are raising concerns that student debt is preventing young workers from qualifying for mortgages, buying new cars and saving for retirement.
Murray said it would be to the benefit of taxpayers to boost economic activity even at the cost of forgoing revenue from interest income.
Default rates on student loans are higher than for credit cards, mortgages and other types of borrowing.
The problem can be traced in part to the recession, when tax revenues dried up and legislators slashed state support for tuition. Across the nation, tuition skyrocketed at state colleges and universities, and stories of graduates with tens of thousands of dollars in loan debt became increasingly common.
Bahr owes more than
He drives a 10-year-old car, doesn't subscribe to cable service and has taken very few vacations since he graduated.
"The biggest thing with this legislation is that the government is actually trying to do something to help us," he said. "The reality is that it is a huge financial burden to go to school."
While Bahr was in school at CWU, tuition and fees rose nearly 40 percent. Today, the estimated cost of attending the
Bahr has been working on the issue since he graduated. He's chairman of a political-action committee, Graduate Washington, which is working to maintain and expand access to higher education in this state.
Bahr faulted the student-loan process as too complex. The long-term ramifications of borrowing are not always clearly explained to 18-year-olds, many of whom have never even had a credit card.
But the biggest issue is how fast college tuition has increased, Bahr said.
"Debt is not the problem," he said. "The problem is the cost of education. Debt is after the fact."
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